Grosse Pointe Park Mayor Palmer Heenan says it's a small amount of millage money that has been used for public works. / JESSICA J. TREVINO/Detroit Free Press

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Detroit Free Press Staff Writer

Library officials in the Grosse Pointes said they were rebuffed recently when they tried to learn how much of their millage funding is being diverted for downtown development in Grosse Pointe and Grosse Pointe Park.

Last week, officials said they sent letters to the two cities, demanding to know exactly how much of the property taxes collected for the system's three libraries was being diverted to downtown development.

"When we passed our (library) millage last year, I think every voter assumed that every penny was going to our libraries," said Brian Garves, president of the Grosse Pointe Public Library board.

But community leaders in Grosse Pointe and Grosse Pointe Park said the amounts of library millage money being held back for downtown projects were minor compared with overall tax collections.

And in Grosse Pointe Park, leaders pointed out that the regional library built there in 2005 is on land that once was polluted and marred by a defunct auto dealership, then cleaned up for the library's use by the city's downtown development authority, or DDA.

"This just wouldn't have happened if we hadn't had our DDA there," said Grosse Pointe Park City Manager Dale Krajniak said. DDAs and other special tax districts can multiply property-tax revenues with grants, donations and private investment dollars, Krajniak said.

"We put about $1.5 million into cleaning up that site, and then we sold the land to the library folks for about $300,000," he said.

The concern in the Grosse Pointes springs from a widening debate over the hundreds of special districts in Michigan called TIFs, for tax increment financing.

TIFS divert portions of millage money they collect within their boundaries to local development projects. The practice has gone on for decades, but this year, it raised a furor after the Wayne County treasurer ordered dozens of Wayne County communities to stop withholding tax money collected by their TIFs for the Detroit Zoo and Detroit Institute of Arts.

Library officials said they've long opposed similar diversions of library millage money but stifled their concern. Now, they want equal billing in the debate over whether some, most or all such millage diversions -- called "tax captures" -- should be phased out.

The Detroit Zoo and DIA millage taxes are collected only in Wayne, Oakland and Macomb counties. But library millages exist in communities across Michigan, so they are ripe for tax captures by more than 600 DDAs and other TIFs, said Gail Madziar, executive director of the Michigan Library Association.

"We'd like to see libraries exempted from that tax capture," Madziar said. That would require new laws, much like the seven bills proposed this month in Lansing to exempt the Detroit Zoo and DIA from the disputed tax captures, she said.

Community leaders and redevelopment specialists counter that libraries lose only a sliver of their funding, and that their sliver, when added to others, makes a big difference when applied to TIF projects in aging downtown and brownfield districts.

In the Grosse Pointes, library board trustees said they were alerted to the loss of revenue by Free Press coverage that mentioned libraries in stories about tax revenue due the Detroit Zoo and DIA.

"We immediately wanted to find out how much of our library revenue was being held back," said library board president Garves, 52, of Grosse Pointe Shores. Grosse Pointe's latest tax increment financing plan, approved by the City Council in January, projects that the DDA could capture as much as $41,000 a year in library revenues by 2020. That could pay part of a library employee's salary, Garves said.

But the amount withheld by the TIFs is tiny when compared with what the cities send overall to the library system, community leaders said.

The Grosse Pointe Park DDA brought in about $110,000 in 2012 revenue (from taxes), of which only $8,300 was derived from the library millage, city officials said. In contrast, the Grosse Pointe Public Library system netted $1,121,800 from taxes levied throughout the rest of the city, they said.

Coupled with grants and private investment, the DDA money has let Grosse Pointe Park make numerous improvements on a half-mile swath of East Jefferson that starts at the border with Detroit, Mayor Palmer Heenan said.

Those improvements, in the last 15 years, include landscaping the median, cleaning up polluted property of a former car dealership, helping to redevelop empty stores and a defunct restaurant into new office buildings, and -- coincidentally -- providing the land for the Grosse Pointe Public Library system's Ewald branch, which opened in 2005, Heenan said.

None of the zoo or DIA tax revenues are being held back in Grosse Pointe Park, he said.

Heenan, 91, who has been mayor of Grosse Pointe Park since 1983, said he hopes to see an art gallery constructed in the next two years on DDA land next to the library.

"I encourage the library all I can ... but there's a useful competition in every city for tax money, and people are really getting a lot of value from these (TIF) districts," Heenan said.